From downsizing to up-sizing
MMTC-West at The Right Place helps companies that are growing again.
A lot of manufacturing companies that survived the Great Recession did so by downsizing. Now many of them need to get bigger again to stay competitive, and that means increased calls to the Michigan Manufacturing Technical Center-West at The Right Place in Grand Rapids.
The Michigan Manufacturing Technical Center organization, headquartered in Plymouth, is a statewide effort begun in 1991 to help the state’s small and medium-sized businesses compete and grow. There are five MMTC regional offices across the state; the Grand Rapids office at The Right Place serves 17 counties in West Michigan.
Bill Small, a vice president at Right Place and director of MMTC-West, said the staff serves about 100 companies a year. MMTC-West is not to be confused with Grand Rapids Community College’s Leslie E. Tassell M-TEC center for technical training on Godfrey Avenue.
MMTC-West is geared to the owners and management of businesses with fewer than 500 employees, with executive training and consulting programs related to growth, diversification, lean manufacturing, sustainability, quality management and others.
“Some companies came out of the (recession) very well positioned to grow, and they’re trying to look at where they should grow,” said Small. MMTC-West has a variety of assistance programs to help the executive teams at those companies map out a strategic direction and goals for successful diversification.
“We help them focus their resources on making sure the new industries they want to enter are a good fit for them and that they come in with a value that others don’t have,” Small said.
Otherwise, he added, a small company that tries to diversify without preparation may enter a new market as just a “me too” player, doomed to fail from the start.
MMTC-West relies on a menu of local resources it has developed over the years, including executives from successful companies who are willing to share their insight.
Small said a good example of a small business that can — and is — getting help from MMTC-West is C3 CNC, a high-tech machine shop on White’s Bridge Road in Belding that has only three employees, two of whom are the founders/owners.
Andy Beach, vice president of C3 CNC, and B.J. Bennett, its president, founded the company in January 2011. Their small facility has a variety of automated CNC machining equipment, with C3 CNC subcontracting for tool-and-die shops and larger manufacturing companies in the Greater Grand Rapids region that need help filling orders. C3 CNC has worked on parts and tooling for the automotive, aerospace and food processing industries.
Beach said the markets his company serves change from week to week, but with two years under their belt, he and Bennett are trying to expand the business with orders placed with them directly, not as a subcontractor. One type of help the company needs is advice and connections regarding bank financing.
“I don’t know what it is, but nowadays a bank won’t touch you,” said Beach. “We’ve never had a line of credit (from a bank). We do everything cash,” he said.
Their investment in CNC machinery was mostly done with cash, although one piece was purchased with a loan from a private investor. The interest rates charged by private investors “are a little bit higher” than what banks charge, he noted — that is, if you can get a bank loan.
Beach said they hope to be able to refinance their private loan with a bank and he is hopeful because “we’ve got good P and L” and work coming in.
MMTC-West is helping C3 with training on QuickBooks, which in its case involves purchasing and invoicing. “We don’t use it very proficiently, but we use it,” he said, so the training will help.
The biggest help C3 is getting from MMTC-West is preparation for putting in place its ISO 9001 quality assurance system. MMTC-West is providing an ISO representative who will spend time on site at C3 to help write the ISO procedures book, “and prepare our shop to get ISO certified so we can hang (the ISO) flag outside. That will be the biggest step for small guys like us to get into bigger, better work.”
Beach, 31, is a Lake Odessa native who has training in engineering and experience as a CNC supervisor and machinist in industrial facilities in Lansing.
Beach, Bennett and a silent partner decided to take the plunge as manufacturing was starting to recover from the brutal years of 2008-2010. “We were hoping to catch it at the beginning of the rise. I think we were close,” he said.
They knew the owner of a 3,000-square-foot building that had been a die repair shop and then remained unused for a decade or more. The partners spoke to the owner about it.
“He said, ‘Yeah, the power’s still hooked up,’ so we rented it from him and filled it full with CNC machines,” said Beach.
Small said the cost of assistance from MMTC-West depends on what the company is looking for and how many resources it has.
One of the best deals at MMTC-West is its Performance Benchmark Assessment, said Small. It has been in use for about 15 years and has about 20,000 entries in its database. Small businesses can use it to compare their performance to peers of the same size in the same industry. The assessment is rather time consuming so it normally costs about $750, but Small said that, because it was developed in Michigan, the MEDC in Lansing will provide one assessment free to every manufacturer in the state, once each year.
Small said MMTC-West does about 25 to 30 Performance Benchmark Assessments a year.
“We haven’t done many lately because of the downturn in the economy, and owners were out running machines,” said Small. “It wasn’t something that people worked on, but we’re starting to see it pick up again,” he said.